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Court may clarify agency review process for out-of-state public utility sites

A state appeals court has asked the Wisconsin Supreme Court to clarify the Wisconsin Public Service Commission’s (PSC) review and approval process for public utility proposals that seek to build out-of-state facilities serving Wisconsin.

The PSC approved a public utility’s application to build a wind farm facility in Minnesota after reviewing the proposal under Wis. Stat. section 196.49.

Consumer groups – including the Wisconsin Industrial Energy Group – sued to require that PSC apply a more demanding application process for larger facilities under section 196.491. That statute contains additional criteria for assessing the facilities’ impacts on Wisconsin ratepayers.

The parties don’t dispute that section 196.491 would apply if the facility was built in Wisconsin. But PSC says application of that statute is unreasonable because it would invoke issues of interest to Minnesota, like land use and local ordinances. Section 196.49 does not.

Consumers say large facility applications contain certain ratepayer protections to ensure that Wisconsin residents are not adversely impacted by construction of large facilities, and the PSC cannot circumvent protection requirements with out-of-state facilities serving Wisconsin.

“[T]he question arises whether the legislature intended to give the PSC the discretion to approve a large facility without considering ratepayer-protection criteria,” the District IV Wisconsin Court of Appeals wrote in its certification to the Wisconsin Supreme Court.

The case is Wisconsin Industrial Energy Group Inc. v. Public Service Commission of Wisconsin, 2010AP2762 (certification filed Nov. 23, 2011). The appeals court noted that the interests of both public utilities and large industrial and residential consumers are at stake.

“Because it appears that all of the major interests are represented in this case, and because the parties are in agreement that the issue is likely to recur, this is an appropriate case for supreme court review,” the appeals court wrote.